The following video is from Wednesday's MarketFoolery podcast in which host Chris Hill, along with analysts Jason Moser and Bill Barker, discuss the top business and investing stories.
In this segment, shares of Pandora (NYSE: P) fell a dizzying 17%, and all the company did to deserve it was lower guidance for the fourth quarter. Here, our analysts discuss why a growth stock like Pandora is hit much harder when it lowers guidance than a larger, more stable company with a more proven business model, and whether Pandora's approach to profitability can ever truly work.
Pandora has won millions of devotees among music fans but few supporters on Wall Street. The online jukebox has put up dramatic growth numbers in its listenership, and seems to be redefining the way we consume music, a transformation that's only likely to grow. But high royalty rates and competition from all corners threatens to silence this upstart before it ever grabs the microphone. Can Pandora translate success with its listeners into a prosperous business model that will deliver for investors? Learn about the key opportunities and potential pitfalls facing the upstart radio streamer in The Motley Fool's new premium research report. Not only will you get the kind of insight normally found from high-priced Wall Street brokerages, but you'll also receive a year's worth of free updates. All you have to do is click here now to activate your subscription to this invaluable investor's resource.
The article Pandora's Uncertain Future originally appeared on Fool.com.
Chris Hill has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple and Google. Motley Fool newsletter services recommend Apple and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.